Petitions submitted on initiative to prohibit taxes on services in Arizona

PHOENIX — Arizona voters may have a new tax initiative to consider in November.

The political action committee Citizens for Fair Tax Policy — funded in part by the Arizona Association of Realtors — filed more than 400,000 petition signatures Tuesday for the Protect Arizona Taxpayers Act.

The measure would ban future service taxes by amending the Arizona constitution.

Supporters needed to submit 225,963 valid signatures by Thursday’s deadline to get the act on the ballot.

The initiative would prohibit any government entity from imposing new taxes on services such as hair styling, real estate, health care and auto maintenance. It wouldn’t affect sales taxes.

Holly Mabery, a Prescott real estate agent who chairs the PAC, said service taxes hit the elderly and poor hardest.

“Everything from our hairdresser to medical services, taking our dogs and cats to the vet, as well as fixing your home or your car,” she said.

She also said similar taxes in Illinois and Washington state have backfired.

Not everyone is on board with the idea.

“I would be very resistant to taxing services,” said Republican Arizona House Speaker J.D. Mesnard. “I’m not suggesting that there aren’t situations where we should tie lawmakers’ hands — mainly in the area of making sure they’re accountable, and being responsible.

“At the same time, I’m not a big fan of restricting policymakers as we try to manage state resources.”

Mabery contended that the economy would be better off if the threat of services taxes were permanently removed.

“Having this amendment to the constitution will actually protect Arizona’s economy, giving it sustainability,” she said. “If there is inconsistency in our economy, that’s when you see small business pack up and move out. And that destabilizes our economy.”